A lot was said lately about the Vorbis/Theora vs h.264/AAC situation on the draft of the HTML5. As some of you know, video is my main hobby these days (I care not about operating systems anymore), so I have gain some experience on the field lately, and at the same time this has made me more demanding about video quality. Read on for a head to head test: OGG Theora/Vorbis vs MP4 h.264/AAC. Yup, with videos. And pictures.

Depends on the purpose, what is youtube used for mostly? music videos, perhaps to watch an anime series, and to show off some work. To get the high res stuf people go elsewhere, think thepiratebay.org.
Besides, youtube does use the better codec, why? better compression = faster download of the complete file. Which is also one of the reasons people use youtube. To have the same bad quality on youtube in ogg/theora it would take longer to load.

Ah well, hopefulle dirac gets finished before the official html5 draft finishes (expected in like euh... 2015 or so ) then there's no need to argue since that one is specifically created for streaming and from the looks of it it's supposed to surpass h264 in quality as well.